Consumers have long benefited from the use of the Yield Spread Premium to offset some or all of their closing costs. The Proposed rule revising Regulation Z, specifically Docket Number R-1366 would eliminate the ability to pay for closing costs using Yield Spread Premium. This would increase the amount of money consumers would need for closings.
You might be asking Why would the Government want eliminate the ability of someone else to pay for a consumers closings costs?
The proposed rule equates Yield Spread Premium to a kickback, instead of the net present value of the future revenue from the mortgage payments. The Federal Reserve Board has focused all of their attention on eliminating Yield Spread Premium instead of the item that really matters and that is simple and clear disclosures that can easily be used for shopping and comparison of mortgage loans.
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If you don’t think your customers should be burdened with having to come up with extra money to close a loan, then let your voice be heard and submit a comment on the proposed revision to Regulation Z.
How your Voice can be heard on the Proposed Rule revising Regulation Z:
› Web Site: http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm Scroll down to Regulation Z - Truth in Lending - Closed-end Mortgage [R-1366], click on Submit comment on this proposal
› Federal eRulemaking Portal: Change the Select Document Type to Proposed Rule, enter keyword "R-1366", click Search, Click on the Submit a comment balloon on far right hand side of results, the ID is: FRS-2009-0240-0001
› E-mail: regs.comments@federalreserve.gov Include the docket number: "Docket Number R-1366" in the subject line of the message.
› Fax: 202-452-3819 or 202-452-3102
› Mail: Jennifer J. Johnson, Secretary, Board of Governors of the Federal Reserve System, and Constitution Avenue, N.W., Washington, DC 20551
The Easiest way to comment online: http://www.federalreserve.gov/generalinfo/foia/ElectronicCommentForm.cfm?doc_id=R-1366&doc_ver=1&name=Regulation%20Z%20-%20Truth%20in%20Lending%20-%20Closed-end%20Mortgages&date=20090723a
All public comments are available at the Boards web site at: http://www.federalreserve.gov/generalinfo/foia/index.cfm?doc_id=R-1366&doc_ver=1 as submitted, unless modified for technical reasons. This means that the information you submit, including identifying information and contact information will be visible.
I sent in my comments and a proposal. Will you do the same?
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